IHG Hotels & Resorts (IHG) and NOVUM Hospitality have announced a long-term agreement that will double IHG's presence in Germany to more than 200 hotels in almost 100 cities through an exciting Holiday Inn – the niu brand collaboration and European debuts for IHG's Garner and Candlewood Suites brands.
The agreement with NOVUM Hospitality, one of Germany's largest private hotel operators, owned by David Etmenan, will make IHG one of the leading players in midscale and upper midscale, and includes the following key elements:
- Up to 108 NOVUM Hospitality open hotels (15,334 rooms) and 11 hotels under development (2,369 rooms) are expected to join IHG's system between 2024 and 2028. Conversion of the hotels to IHG's system will happen in phases beginning in 2024, with the majority to take place over the next 24 months. This will increase IHG's global system size by up to 1.9 percent over the coming years.
- A total of 52 open and pipeline hotels will join IHG through a distinctive collaboration between Holiday Inn and the niu, NOVUM Hospitality's stylish, flagship upper midscale brand. This will combine the domestic presence of the niu with Holiday Inn's trusted reputation and global brand recognition to build a leading position in a key target market. NOVUM Hospitality's other brands, Yggotel, Select and Novum, with 56 open and pipeline hotels, will convert to IHG's new midscale conversion brand, Garner, and the acora Living the City brand, with 11 open and pipeline hotels, will convert to IHG's midscale extended stay brand, Candlewood Suites.
- Under the agreement, IHG will receive franchise fees after the phased conversion of existing properties and the opening of the hotels under development. Additionally, standard assessments will be received into IHG's System Fund, including those to cover the operation of IHG One Rewards and marketing and reservation services. IHG will contribute key capital expenditures that will reflect the phased conversion and timing of openings of this major portfolio of hotels.
- The agreement includes an exclusivity arrangement for future NOVUM Hospitality hotels to join IHG's leading brands and enterprise system, with an ambition to develop further hotels over time jointly.
- The agreement has a term of 30 years and the option to renew for additional terms.
IHG's growth in Germany will be supported by continued investment in building localised commercial platforms, such as the recent introduction of loyalty partnerships and improved booking systems. IHG expects its increased scale to bring significant benefits to NOVUM Hospitality and other IHG owners, including higher brand awareness, direct bookings and loyalty engagement, to capture both domestic demand and German outbound business. It will also drive the development of IHG's brands across more locations.
"We are delighted to collaborate with such a respected group as NOVUM Hospitality and double IHG's presence in Germany, one of Europe's largest hotel markets and a growth priority for our business," said Elie Maalouf, chief executive officer of IHG.
"This agreement demonstrates the appeal to owners of our powerful enterprise and IHG's success in attracting excellent conversion opportunities to grow our system size. It also creates a strong domestic German platform to increase demand and brand awareness, as well as capture a larger share of the millions of outbound trips made each year across Europe and beyond."
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